All Forum Posts by: Peter Lange

@Dan Schwartz - not sure why that link didn't post, but here it is http://www.nolo.com/legal-encyclopedia/single-member-llcs.html

Here's an interesting link on the topic from Nolo - basically saying it is a gray area of the law currently.

Thanks @Dan Schwartz and @Chris Soignier, I understand the IRS's use of the term and the tax implications. I'm asking my question from a legal perspective because I saw a presentation by Aaron Young, CEO of Laughlin and Associates, over the weekend,and he was basically saying that he didn't think single member LLC's were good corporate entities siting the "disregarded entity" designation as one of the main reasons why. Of course, I am I'm paraphrasing here, and I may have interpreted what he said incorrectly, but I don't think so. I think this is an important legal question to be clear on because I think a lot of us out there have single member LLC's. BTW, if you and your spouse are the only members of the LLC, it is still considered a single member LLC if you file jointly. @Scott Smith, what say you?

Scott, I actually have a couple of questions I've been meaning to call you about, but since you asked here on BP, I thought I would ask my questions here in the hopes of helping out others with the same questions.

1 - Single Member LLC's are considered disregarded entities by the IRS. Do you see this type of thinking spilling over to the courts to the degree that a single member LLC's will offer no protection to the single member? How does having a trust as the single member help or not help the prospects for these types of entities in the future?

2 - Is there any case law that supports the use of Joint Venture agreements for investing in real estate notes? I've heard some people say that these types of agreements might not be OK with the SEC as they may consider this type of transaction agreement a security. Is there any concern in using these types of agreements when pulling in a money partner for taking down single notes or multiple notes with the same single investor? 

Thanks. You're the best!

It's not as educational as Paper Source in Las Vegas that was last weekend. However, if you are into notes, it is a great place to network. Last year the content was mostly "big picture" industry related.

The Seller Finance Coalition (http://www.sellerfinancecoalition.org/) is working Washington to introduce some legislation to reduce the impact of the Dodd-Frank bill on seller financing. Given their success in gaining traction in DC on seller financing, it seems the issues you note could be on their radar as well. Maybe @Bob Repass can comment.

Welcome! I'm an Austin note investor and a long time sailor!

@Don DeMarco - I'm just getting into notes and have a few questions about your post. Is 60% workout considered high, average or low in the industry? Eddie Speed says average is 40% workout, 40% DIL, and 20% foreclose. So, I'm guessing your figure is high. I looked at your website and see that you are focused on firsts. So, I'm assuming your figure is for firsts and so is Eddie's. Any idea what the workouts stats are for seconds? What is happening with your other 40%? Thanks.

@KJ Smith - I'm just getting into notes as well, and one of the key decisions you will need to make up front is what types of note strategy do you want to pursue. From what I have learned so far, there are essentially three general areas. Some of the educational sources for each are:

1 - Performing Firsts - Eddie Speed's Note School

2 - Non-performing Firsts -  Sherman Arnowitz's Keyhole Academy, Eddie Speed's Note School as well as Scott Carson as noted previously

3 - Non-performing Seconds - David Van Horn's PPR, Fuquan Bilal's NNG Academy,  Sherman Arnowitz's Keyhole Academy.

I'm 100% certain I am missing other sources, but these are the ones I am familiar with. A general site is http://papersourceonline.com/. I have also found the NoteMBA podcast to be very informative on non-performing first investing.

Great summary, @Patrick Desjardines ! I know you didn't attend the Bonus Day on Sunday. So, let me add a few "notes" on that event. For those who don't know, the "Bonus Day" was basically a condensed Eddie training on a few topics with, of course, some pitching for his 3 day training events. The most interesting topics were Eddie's 50/50 Model for selling homes to out of state cash investors, and creating partials on your performing notes. Without getting into the nuts an bolts, both of these strategies allow you to get your initial investment back AND STILL stay in the deal to have an infinite return! That's fantastic, but remember you get all of your initial investment back so you can do it all over again!  So, while I agree with @Patrick Desjardines that the Friday and Saturday educational content value was low (I would probably give a range of B to F for individual sessions), the Bonus Day educational content was an A!